<!DOCTYPE html>
<head lang="en">
  <title>CP1 Reversion</title>
  <meta charset="utf-8">
  <link href="../style.css" rel="stylesheet" type="text/css">
</head>

<body>
  <h1>Possible risks for all contracts</h1>

<div class="column side">
For all the quesetions regarding discussing / describing a risk. you also need to discuss the tools to reduce that particular risk.
</div>

<div class="container">

  <div class="column middle" >
    Common for all
    <div id="content">
      <ul>
        <li>
          New business volume risk: too high (exhaust capital) too low (not enough to cover the fixed expense)
        </li>
        <li>
          Mix of business, if there is cross subsidy..
        </li>
        <li>
          Investment risk
          <ul>
            <li>
              Market risk: Assets may not deliver required return.
            </li>
            <li>
              Credit risk: the issuer of any assets may default
            </li>
          </ul>
        </li>
        <li>
          Cash flow mismatching risk
          <br>
          no cash is received until the policyholder dies so liquidity is needed from elsewhere to pay the annuity.
        </li>
        <li>
          Liquidity risk: Liquidity risk occurs when an individual investor, business, or financial institution
          cannot meet its short-term debt obligations.
          The investor or entity might be unable to convert an asset into cash without
          giving up capital and income due to a lack of buyers or an inefficient market.
        </li>
        <li>
          External risk: Changes in regulation, changes in solvency requirements, tax changes
        </li>
        <li>
          Operational risk: Operational risk is the prospect of loss resulting from inadequate or failed procedures
          , systems or policies. Employee errors. Systems failures. Fraud or other criminal activity.
          Any event that disrupts business processes.
        </li>
      </ul>
    </div>
  </div>


  <div class="column middle" >
    For life insurance
    <div id="content">
      The risk of underprice.
      <ul>
        <li>
          Mortality risk
        </li>
        <li>
          Investment risk
        </li>
        <li>
          Expense risk
        </li>
        <li>

        </li>
        <li>
        </li>
      </ul>
    </div>
  </div>


  <div class="column middle" >
    For pension
    <div id="content">
      The risk that the promised benefit can not be met, resulting from
      <ul>
        <li>
          Wrong actuarial assumption
        </li>
        <li>
          Adverse market movements
        </li>
      </ul>
    </div>
  </div>


  <div class="column middle" >
    For general insurance
    <div id="content">
      <ul>
        <li>
          Accumulations of risk (e.g. geographical or by class of business) and catastrophy
        </li>
        <li>
          Poor persistency rate
        </li>
      </ul>
    </div>
  </div>


  <div class="column middle" >
    <div id="content">
    </div>
  </div>

</div>


<footer>
  <p> Author: Mengke, Lyu</p>

</footer>
</body>
